Fixed Assets

Fixed assets represent the long-term tangible property your business uses in operations -- equipment, vehicles, furniture, buildings, and more. AI-native ERP manages the complete asset lifecycle from acquisition through depreciation to disposal, with automatic GL posting at every stage and reconciliation tools that keep your subledger aligned with the general ledger.

Asset Categories#

Before creating individual assets, you set up categories that define default depreciation parameters. A "Computer Equipment" category might specify straight-line depreciation over 36 months with zero salvage value, while a "Vehicles" category uses declining balance over 60 months with 10% salvage. When you create an asset in a category, it inherits these defaults -- though you can override them per asset when needed.

Acquisition#

Assets can be acquired through multiple paths. The most common is acquiring from a vendor bill: when you receive a bill for equipment and post it to an asset GL account, the system can link that transaction to a new fixed asset record. You can also capitalize expenses (converting an operating expense to a capital asset) or capitalize construction-in-progress costs once a project is complete.

The acquisition process creates the initial asset record with its cost basis, in-service date, and depreciation schedule. Every acquisition links back to its source transaction for full traceability.

Depreciation#

Monthly depreciation is the core ongoing operation. You can preview what a depreciation run will produce before executing it -- seeing each asset's depreciation amount, the accounts that will be affected, and the total impact. When you are satisfied with the preview, processing the run creates GL entries that debit depreciation expense and credit accumulated depreciation for each asset.

The system handles catch-up depreciation automatically. If you add an asset with a past in-service date or miss a depreciation run, the system calculates the accumulated depreciation for all missed periods and posts it in a single catch-up entry.

Transfer, Impairment, and Disposal#

You can transfer assets between departments or locations, updating the dimension tags that drive cost allocation and reporting. Impairment entries reduce an asset's carrying value when its fair value drops below book value, posting the loss to the income statement. Disposal records when an asset is sold, scrapped, or retired, calculating and posting any gain or loss on disposal.

Reconciliation#

The fixed asset reconciliation tool compares your asset register (total cost and accumulated depreciation by account) against the corresponding GL account balances. Any discrepancies are reported with possible causes and investigation guidance, helping you maintain perfect alignment between the subledger and general ledger.